Gordon Campbell | Parliament TV | Parliament Today | News Video | Crime | Employers | Housing | Immigration | Legal | Local Govt. | Maori | Welfare | Unions | Youth | Search


National's tax cuts: a massive employer subsidy

23 August 2005 - Alliance - Auckland

National's tax cuts: a massive employer subsidy

Instead of confronting the chronic problem of low wages, National's tax cuts amount to a $4 billion annual subsidy to employers. Wages will stay low while taxpayers pay for their own income rise with cuts to public services and through borrowing at market interest rates from overseas bankers.

"Some deal!" says Auckland Alliance spokesperson, Len Richards, "National looks after its friends. It is the rich and employers who benefit most from Brash's tax cut plans."

Labour has joined the unseemly auction for the votes of the middle class with a $1.5 billion subsidy for working families with children. This plan at least has the saving grace of targeting children. But the children of the poor are left out. Labour's plan will not extend to beneficiaries. According to Child Poverty Action 130,000 children live in real poverty.

Mr Richards said that under the Alliance tax policy, the first $10,000 of income will be tax free. This applies to everyone, but it would most benefit those on low incomes, including pensioners and beneficiaries.

Alliance tax spokesperson, Professor Jim Flynn, explained in his recent tax policy press release: "At present, Kiwis pay $1530 on their first $10,000. So this amounts to a new deal for pensioners and beneficiaries."

Professor Flynn said the Alliance tax policy is the kind of progressive tax system that existed in New Zealand before Labour and National decided to benefit the rich and attack the most vulnerable.

"The Alliance policy represents a significant redistribution of wealth. The 85,000 Kiwis who make more than $100,000 a year would, rightly, bear a much greater burden. Someone on $200,000 a year would pay an extra $18,460 in tax," said Professor Flynn.

The Alliance would use taxes to redistribute wealth but ultimately the way working class people can obtain a greater share of the wealth that they create through their work is by increases in salaries, wages, pensions and benefits.

"Unpaid people contribute through their work raising children and through other unrecognised contributions to society, so they should not be left out," says Mr Richards.

"The Alliance will fight for an increase the minimum wage to $15 an hour, abolition of youth rates and strengthened protection for casualised workers. Workers' rights to organise should be extended, including the right to strike. This will enable workers to gain a bigger share of the cake, rather than just scramble for the crumbs falling off the table."

NOTE: Tax table below

NOTE: The incomes in this Table refer to individuals not families. For example, a
family with two earners that each make $41,000 would pay no extra tax.


0 - 10,000 nil 10,000 nil nil Up to $1530

[No tax on the first $10,000 (and this includes those on super and other benefits)
means that all on that income will be forgiven the $1530 they pay at present]

Almost a million
10 - 20,000 24 20,000 12.00 2,400 Kiwis will average $1380 less tax
360,000 Kiwis
20 - 30,000 26 30,000 16.67 5,000 will average
$980 less tax
309,000 Kiwis
30 - 40,000 30 40,000 20.00 8,000 will average
$300 less tax

[The 75% of New Zealanders under $41,000 will pay less tax]

253,000 Kiwis
40 - 50,000 40 50,000 24.00 12,000 will average
$280 more tax
141,000 Kiwis
50 - 60,000 42 60,000 27.00 16,200 will average
$1080 more tax
104,000 Kiwis
60 -70,000 46 70,000 29.71 20,800 will average
$1880 more tax
141,000 Kiwis
70 -100,000 50 100,000 35.80 35,800 will average
$3800 more tax
85,000 Kiwis
100,000+ 54 200,000 44.90 89,800 will average
$18,460 more tax


© Scoop Media

Parliament Headlines | Politics Headlines | Regional Headlines

Werewolf: What Does Winston Peters Want His Legacy To Be?

A lot of people in New Zealand seem to resent Winston Peters and the power that he appears to have. “Appears” being the operative word. In reality, Peters will have power only up to the point that he uses it.

By next week, he’ll have become just another junior player in an MMP governing arrangement, battling to hold onto the gains he was promised. More>>


Rising Toll: Road Safety Needs To Be A Higher Priority

Official advice released to the Green Party under the Official Information Act shows that the previous National Government dismissed an option to make road safety its most important transport priority after being told the road toll was rising. More>>


Wellington.Scoop: Arrests At Blockade Of "Weapons Expo"

“We encourage people in Wellington to get down to the Westpac Stadium now for a day of awesome peace action. There will be plenty of food, music and activities to keep us sustained through the day.” More>>


Rorschach Restructuring: PSA Taking Inland Revenue To Court Over Psychometrics

The Public Service Association will be seeing Inland Revenue in Employment Court over its intention to psychometrically test employees reapplying for their roles at the department as part of its controversial Business Transformation restructuring plan. More>>


Nuclear Disarmament: Nobel Peace Prize 2017 Awarded To ICAN

Congratulations from iCAN Aotearoa New Zealand to international iCAN, the other iCAN national campaigns and partner organisations, and the countless organisations and individuals who have worked so hard for a nuclear weapons-free world since 1945. More>>


Expenses: Waikato DHB CEO Resigns

An independent inquiry has identified that Dr Murray had spent more than the agreed $25K allocated for relocation costs, and other unauthorized expenses involving potential financial breaches of the chief executive’s obligations. More>>


Wellington.Scoop: Sad About The Trolley Buses?

The Regional Council’s MetLink is today spending money to tell us that it really loves Wellington’s trolley buses, even though they’re all being taken off our roads by the end of this month. More>>


Post-Election: Preliminary Coalition Talks Begin

New Zealand First will hold post-election preliminary discussions in Wellington with the National Party tomorrow morning and the Labour Party tomorrow afternoon. More>>




Featured InfoPages

Opening the Election